Time for action on new growth path, says Busa

The new growth path (NGP) economic strategy must lead to implementation if it is to have any value, Business Unity SA (Busa) said today.

“If talking could be factored into our GDP, South Africa would be the fastest-growing economy in the world,” Raymond Parsons, deputy CEO, told media in Johannesburg.

The NGP, unveiled by Economic Development Minister Ebrahim Patel last week, was another in a series of programmes government had presented over the last 16 years.

These included the reconstruction and development programme of 1994, the growth and redistribution strategy of 1996, and the “Harvard” Economists Study of 2007.

“We’ve been here before,” said Parsons.

Jerry Vilakazi, CEO of Busa, agreed, saying it was now time for implementation.

“If you’ve got a patient who’s not well, you can’t keep diagnosing the patient ... without actually dealing with the sickness,” he said.

“We know what the problems in the economy are... it’s time for action, for implementation... we’ve got to make the hard choices that we avoid making.”

Parsons was presenting Busa’s first reaction to government’s document, but said it would be having further discussions and go into more detail later.

Parsons said to create a job-rich economy, the top priorities were improving the educational system, skills development and public sector delivery.

All these activities needed to happen in tandem, taking account of the capacity of the state.

To achieve these priorities, Busa identified various tough choices that needed to be made.

These included sticking to a disciplined macroeconomic approach, rather than giving into inflationary temporary job boosting and ensuring the state was delivering.

More skills and support should be put into the education system rather than more money, and business should be more involved in skills development.

It also included re-engineering state-owned enterprises and taking a bold approach to unlock entrepreneurial energy.

Parsons said Busa largely agreed with the frameworks created by the New Growth Path, such as getting rid of red tape, linking remuneration to productivity and promoting small business.

It also welcomed the setting of a target to create five million jobs. A key target of the NGP is creating five million new jobs by 2020 and thus reducing unemployment by 10 percentage points, from a current 25% to about 15%.

Busa differs on much of the detail in the document.

Parsons questioned the future role of the state in the economy.

“The key question is what should the government do? What should the government not do. And what should the government ensure should be done?” he said.

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